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Microeconomic Analysis

Microeconomic Analysis

Code	14161
Year	1
Semester	S1
ECTS Credits	7,5
Workload	OT(3H)/TP(30H)
Scientific area	Economics
Entry requirements	N.A.
Learning outcomes	This curricular unit has as fundamental objectives to develop an in-depth knowledge of advanced microeconomic theory and to develop analytic skills of microeconomic problems. At the end of the semester the student should have an advanced knowledge of: • Consumer and producer theory and duality theory applied to these two topics • Decision under uncertainty • General equilibrium and welfare theorems • Complete and incomplete information games • Problems of asymmetric information At the level of the competences, this UC intends to develop the analytical skills and the ability to do research. By the end of the semester students should be able to: • Identify and critically analyze microeconomic problems. • Model microeconomic problems • Formally solve microeconomic models • Assess the implications for economic policy and empirical and experimental studies
Syllabus	1. Consumer Theory a. Choices, preferences and utility. Revealed preference. b. Consumer’s problem c. Indirect utility function, expenditure function and demand functions d. Duality and integrability e. Decision under uncertainty 2. Producer theory a. Production sets b. Profit maximization, supply function and profit function c. Cost minimization, conditioned demand and cost function d. Duality in production 3. Decision under uncertainty a. Expected utility theory b. Monetary lotteries and risk aversion c. First order and second order stochastic dominance 4. General equilibrium and welfare a. General equilibrium under perfect competition b. Pareto optimality and fundamental welfare theorems 5. Game theory a. Static games of complete information b. Dynamic games of complete information c. Static games of incomplete information d. Dynamic games of incomplete information 6. Asymmetric information problems a. Incentives and moral hazard b. Adverse selection c. Signaling
Main Bibliography	Jehle, Geoffrey A., Reny, Philip J., “Advanced Microeconomic Theory”, Pearson, 3rd, 2011. Mas-Colell, A., Whinston, M, Green, J., “Microeconomic Theory”, Oxford University Press, 2012. Varian, Hal R., “Microeconomic Analysis”, Norton & Company, 3ª. Revised Ed. 2009.
Language	Portuguese. Tutorial support is available in English.